Wearables ‘set to change banking’

Banks need to accelerate their wearables strategies if they are to meet global customer demand, a new study by Misys has warned.

A survey by the vendor found that while 96 per cent of retail banking professionals agreed that wearable technology would impact their industry, only 15 per cent reported that their business had already rolled out a wearable app or was in the process of doing so.

The poll of 166 executives from financial institutions around the world revealed that 72 per cent had wearables on their three-year roadmap, while 52 per cent were planning to go live with a wearable app in the next 18 months.

Of the banks that had no wearables strategy in place, 78 per cent were in the EU and US, suggesting a stronger appetite for innovation in this area from the LATAM and Asian regions. However, this did not reflect demand, Misys pointed out, as a recent NPD study predicted that during 2015 some 15.6 million smartwatches and activity trackers would be sold in North America, and 12.5 million purchased in Western Europe.

Two thirds of the banks surveyed highlighted proximity payment as the most attractive wearables capability, while 31 per cent though greater fraud protection through push notifications was a compelling feature. In the future, respondents suggested authentication processes (64 per cent) and the ability to send push messaging (47 per cent) would increase the adoption of wearable technology among banking customers.

Balazs Vinnai, general manager for digital channels at Misys, said: “Banks continue to face challenges with their digital strategies, so it is no surprise only a small percentage currently support wearables. It is critical for banks to consider new digital channels as part of an integrated strategy and evolve from first to second generation digital banking; switching digital from a supporting role, to the primary sales and communication channel. Reengineering processes around the customer is not easy, but banks must embrace digital banking to remain competitive and relevant.”

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